Stornoway (SWY.TO) Completes Finance Agreement With Quebec for Renard Mine Road
MONTREAL, QUEBEC--(Marketwire - Dec. 7, 2012) -Stornoway Diamond Corporation (TSX:SWY) is pleased to announce that its wholly-owned subsidiary Les Diamants Stornoway (Canada) Inc. has completed a Financing Agreement with the Québec Ministère des Finances et de l'Économie ("MFE") under which Stornoway will be financed to complete the construction of a mining-grade access road to the Renard Diamond Project (the "Renard Mine Road"). The Financing Agreement is pursuant to a Framework Agreement and associated Letter of Intent previously executed between Québec and Stornoway and announced on November 15, 2012. The Framework Agreement and the now-completed Financing Agreement are designed to ensure all-season road access to Renard during 2013. Features of the Financing Agreement are as follows:
•Québec to provide Stornoway with a credit facility of up to C$77m ("Loan A") to complete the road construction work, at an annual interest rate of 3.35% percent, for a term of 15 years, with repayment beginning 48 months following first disbursement, and deferrable up to 2 years due to any delay in the attainment of commercial production at Renard past July 1, 2016.
•Québec to provide Stornoway an additional overrun facility of up to C$7.7m ("Loan B"), at an annual interest rate of 6.3% percent, with repayments concurrent with Loan A.
•Stornoway undertakes to complete construction of the Renard Mine Road no later than June 30, 2015, subject to certain terms, including terms of the previously announced Framework Agreement.
On the basis of the construction schedule as currently anticipated, Stornoway expects to request an initial disbursement under Loan A during the month of December 2012.
